An Investigation into the Management of Interest Rate Risk in Large UK Companies

Financial risk management is currently subject to much debate, especially the accounting for derivative products, and a number of commentators are objecting to the introduction of International Accounting Standard IAS 39 for Derivatives that will be in force by January 2005 for all EU companies. The topic of hedge accounting and the treatment of fair values may have a significant impact on many companies reported profits, and the volatility of earnings is likely to increase.

Uniquely this monograph focuses on interest rate risk management. Most studies of corporate risk management have typically dwelt on the topic of management of exchange rate risk, with interest rate risk management being neglected. The book’s findings examine the views of UK corporate treasurers who are usually involved in the risk management strategies of their organisation and who have responsibility for implementing those strategies in practice.

Interest Rate Risk Management is for all finance and management professionals whose work involves managin interest rates.

This book seeks to publicise the fact that interest rate risk management is just as important to organisations as foreign exchange risk management and that tehre are a number of factors that affect how interest rate risk in managed in practice. Most studies of corporate risk management have typically dwelt on the topic of management of exchange rate risk, with interest rate risk management being neglected. The book's findings examine the views of UK corporate treasurers who are usually involved in the risk management strategies of their organisation and who have responsibility for implementing those strategies in practice.

This book covers practical management issues such as:
* The derivatives that can be used to hedge the risk
* the importance of factors such as the shape of the yield curve
* the current interest rate environment
* interest rate expectations in the risk management process
* the impact of IAS39 on the management of interest rate risk management